JN

World "Awash" in oil. Sec Perry says Goldman Sachs wrong.

Recommended Posts

(edited)

https://www.bloomberg.com/news/articles/2019-10-27/world-awash-in-oil-as-u-s-sees-its-shale-boom-barreling-ahead

Shale companies like Conoco, EOG, Occidental, Hess, EXXON, Chevron, or Continental, etc have cut rigs avg of 30% and increased production. Small players are trying to adapt but many will fail. 

Beginning of 2019 U.S oil production 11.7 million barrels day.  Last few weeks has been 12.6 million day.    That is that is 900k barrel increase.  Is slowing down.  No capital for smaller players.  New bonds and business models may save a couple.

Production will continue to slow or even plateau until consolidation takes place in 2020. Lack of U.S. VLCC Export terminals may give OPEC reprieve for two years. Three Gulf of Mexico terminals by 2022. Enterprise Products, Phillips, Trafigura will have VLCC terminals. Will each load a 2 million barrel VLCC in 24 hours. 

Also need NGL export terminals to meet high Asian demand per Enterprise Products CEO.

Footnote: Goldman is bias. Lead Banker on Aramco IPO. The IPO payout 450 million dollars in fees.

 

New York Times Says Flood of New Oil Production

Projects lower oil prices 

What's bigger.  "Awash" or "FLOOD"

https://www.nytimes.com/2019/11/03/business/energy-environment/oil-supply.html

 

 

CONOCO INVESTOR DAY NOVEMBER

This month Conoco is having an investor day.

* They will discuss there aggressive production plans for 2020

* They will detail their future plans for their shale development in Eagleford, Bakken, and Permian. 

* They will discuss their use of technology to increase Productivity, EUR, Cost Reduction and Profit. 

they will not be talking about Peak Oil Supply . . . . it doesn't exist.

Edited by Jabbar

Share this post


Link to post
Share on other sites

Gerry you're hilarious when you're pissed off 

  • Haha 2
  • Upvote 1

Share this post


Link to post
Share on other sites

3 hours ago, DayTrader said:

Gerry you're hilarious when you're pissed off 

DT, I think he was just warming up....hide and watch😂

  • Haha 3

Share this post


Link to post
Share on other sites

(edited)

3 hours ago, Gerry Maddoux said:

Have you ever personally seen what it takes to get a barrel of oil out of the ground and into a barrel?

YES .

You stand corrected.

Edited by Jabbar

Share this post


Link to post
Share on other sites

(edited)

3 hours ago, Gerry Maddoux said:

 

Do you have any idea of history?  

YES, but I only received a D+ in European History.  Teacher didn't like me.

 

Do you have any idea what it's going to cost to transport a VLCC full of oil to China after the low-sulfur bans are in place?  

Yes, bit higher at first . Will be back to current after 4 months.

Do you have any idea what the Saudis have in reserve? I don't either, but it's a given that it's less than they had five years ago. 

Whats your point.  Plenty of oil world reserves.

Occidental has ten billion borrowed at 8% interest--but they're trying to sell property.

Stupid CEO. Way overpaid for Anadarko. Shareholders are bulls*"'*#! . Still low cost leader lifting a barrel of oil. 

Secretary Perry doesn't have a f****** clue. 

Agree. Perry big oil hack.

But I'll damn sure guarantee you one thing: the world is NOT currently awash in oil.  

Respectfully disagree. Plenty of oil.  What happens when Iran, Venezuela and Libya put oil on the market. 

Most of the articles on Oilprice are meant to scare people, written by someone like you:

How dare you associate me with that "ham & egger" trade rag.

who hasn't a brain cell's idea of what it's like to go take a risk, bring up a barrel of oil, try to peddle

Have engineering degree from KSU.  Used it in finance world.

It's just bullshit. I don't mind you saying it, but I do want to call it out as bullshit. It's not even provocative. 

LOL

 

YES .

Edited by Jabbar

Share this post


Link to post
Share on other sites

(edited)

12 hours ago, Gerry Maddoux said:

Have you ever personally seen what it takes 

YES .

Sorry if I hit a nerve.  

I simply posted a link to Bloomberg News article.  I won't link any of their articles again. Sorry.

Edited by Jabbar
  • Haha 1

Share this post


Link to post
Share on other sites

(edited)

 

 

Is OPEC+ cutting production because there is not enough oil  ?

No

OPEC+ is cutting because TOO MUCH OIL.

"Awash" might be a little strong. How about the  "Market flush with oil".

CONOCO INVESTOR DAY

This month Conoco is having an investor day.

* They will discuss there aggressive production plans for 2020

* They will detail their future plans for their shale development in Eagleford, Bakken, and Permian. 

* They will discuss their use of technology to increase Productivity, EUR, Cost Reduction and Profit. 

they will not be talking about Peak Oil Supply . . . . it doesn't exist.

 

Edited by Jabbar

Share this post


Link to post
Share on other sites

Jabbar and Gerry....chill!😂

The fact is that absolutely nobody has an accurate number for either global reserves OR the amount in storage.

North America MAY have a better idea than other regions, but even that is questionable. Ask yourself, ‘Where do these numbers actually come from?’. If I am not mistaken, the EIA is based on a weekly (monthly?) questionnaire and relies on ‘good faith’ reporting. Much of this reporting elsewhere is from national oil companies who may be somewhat biased in their reporting.

Regardless, there is no centralized reporting mechanism for oil in storage.

Reserves are another issue. You have ‘proven’ reserves based on sound (hopefully) geophysics, geology, and pressure/flowrate data. You then have ‘unproven’ reserves which are essentially a SWAG (silly wild assed guess) which are usually highly optimistic to make the company look attractive to investors.

In my humble opinion, you can look at the reported oil in storage and reserves broadly, and it is true that some players are presently out of the game, but the real issue is demand.

We need demand up to dry up ANY storage to get the price up and hopefully kick start any drilling (exploration, appraisal or development...onshore or offshore).
 

  • Like 1
  • Great Response! 2
  • Upvote 2

Share this post


Link to post
Share on other sites

(edited)

14 hours ago, Douglas Buckland said:

Jabbar and Gerry....chill!😂

 

Quote

 

Doug

Does Gerry always get this worked up.

You say "he's just getting warmed up"

How bad does it get ?!?

If you know him tell him I'm sorry.

Edited by Jabbar
  • Haha 2

Share this post


Link to post
Share on other sites

12 hours ago, DayTrader said:

Gerry you're hilarious when you're pissed off 

please don't encourage this behavior.

  • Haha 2

Share this post


Link to post
Share on other sites

1 minute ago, Jabbar said:

please don't encourage this behavior.

Why? It’s cheap entertainment! Bring your own popcorn....

  • Haha 6

Share this post


Link to post
Share on other sites

In all fairness, there is plenty of oil globally.  Iran, Venezuela, as well as North Africa are experiencing some issues, but the oil is still there.  Look for Vaca Muerta to come on soon as well.

Rick Perry is ENERGY Secretary; and while clueless, needs to set some ENERGY policy.  This would include coal, nuclear, hydrocarbon, as well as renewables. Don't look for it to happen under his watch though.

Mexico will be glad it hedged, as if the right combination of circumstances present themselves simultaneously, we could see oil drop below $40 for WTI.

Everyone should not get so emotionally charged when posting here; that's what keeps many real professionals off this site..!

 

 

 

  • Great Response! 4
  • Upvote 2

Share this post


Link to post
Share on other sites

11 minutes ago, Outlaw Jackie said:

In all fairness, there is plenty of oil globally.  Iran, Venezuela, as well as North Africa are experiencing some issues, but the oil is still there.  Look for Vaca Muerta to come on soon as well.

Rick Perry is ENERGY Secretary; and while clueless, needs to set some ENERGY policy.  This would include coal, nuclear, hydrocarbon, as well as renewables. Don't look for it to happen under his watch though.

Mexico will be glad it hedged, as if the right combination of circumstances present themselves simultaneously, we could see oil drop below $40 for WTI.

Everyone should not get so emotionally charged when posting here; that's what keeps many real professionals off this site..!

 

 

 

Vaca Muerta will be interrsting. It may be a flash in the pan. It looked interesting while the US shale game (pun intended) was going like a house on fire, bit with the US shale game losing steam recently, will the investors still be interested?

  • Like 1

Share this post


Link to post
Share on other sites

Furthermore, with exploration at an all time low (well, 70 year low) and replacement barrels not keeping up with production, the oil may be physically in the ground but access to it and then getting it to a refinery are years away, During those years, thing’s may get interesting!

  • Upvote 4

Share this post


Link to post
Share on other sites

From article:"... and enabled it (United States) to become a net energy exporter"

2018 oil output: 15311, 2018 oil consumption: 20456 . Net imports: -5145 thousand bbl/d

2018 natural gas, net exports: +14 billion cubic meters

electricity net imports usually about -50 TWh

So fast approaching but not there yet.

  • Like 1
  • Great Response! 1

Share this post


Link to post
Share on other sites

Forgot BP includes ethanol in consumption so adjust by about +0.7 m bbl/d

Share this post


Link to post
Share on other sites

(edited)

2 hours ago, Marcin said:

From article:"... and enabled it (United States) to become a net energy exporter"

2018 oil output: 15311, 2018 oil consumption: 20456 . Net imports: -5145 thousand bbl/d

2018 natural gas, net exports: +14 billion cubic meters

electricity net imports usually about -50 TWh

So fast approaching but not there yet.

Keep it simple.

US exports 3.7 million day of crude

US exports Over 5.5 million day of petroleum products. 

TOO MUCH OIL

Edited by Jabbar

Share this post


Link to post
Share on other sites

23 hours ago, Jabbar said:

https://www.bloomberg.com/news/articles/2019-10-27/world-awash-in-oil-as-u-s-sees-its-shale-boom-barreling-ahead

Shale companies like Occidental, Hess or Continental have cut rigs avg of 30% and increased production. Small players are trying to adapt but many will fail. 

Beginning of 2019 U.S oil production 11.7 million barrels day.  Last few weeks has been 12.6 million day.    That is that is 900k barrel increase.  Is slowing down.  No capital for smaller players.  New bonds and business models may save a couple.

Production will continue to slow or even plateau until consolidation takes place. Lack of U.S. VLCC Export terminals may give OPEC reprieve for two years. Three Gulf of Mexico terminals by 2022. Enterprise Products, Phillips, Trafigura will have VLCC terminals. 

Footnote: Goldman is bias. Lead Banker on IPO.

SIAP but a couple corrections:

1. December 2018 US production was 12.038 million barrels.

2. July 2019 US production was 11.806 million barrels (production hurt by Gulf hurricanes so August may be higher)

3. The 12.6 million barrel figure you cited is an EIA estimate which are usually about as accurate as Baghdad Bob.

Actual August production will be reported on Thursday.  It may be higher than July because of no hurricanes but it may be lower too because of dropping rig count.  Actual 2019 US production maxed out at 12.1 million and I doubt it's up to 12.6 million in the last few weeks as you and the EIA claim.

  • Like 2
  • Great Response! 1

Share this post


Link to post
Share on other sites

(edited)

7 hours ago, Douglas Buckland said:

Vaca Muerta will be interrsting. It may be a flash in the pan. It looked interesting while the US shale game (pun intended) was going like a house on fire, bit with the US shale game losing steam recently, will the investors still be interested?

Vaca  Muerta potential is BIGGER than Permian. 

However, the recent elections with new socialist government could kill the goose that was about to lay the golden egg.

The Oil Majors were just starting to ramp production when the election changed everything.

Majors waiting to see new government Vaca policy.

Edited by Jabbar
  • Great Response! 1

Share this post


Link to post
Share on other sites

13 minutes ago, Jabbar said:

US exports 3.7 million day of crude

US exports Over 5.5 million day of petroleum products. 

 

"net exporter" means you export more than you import. United States is not net energy exporter it is net energy importer.

In your example you miss the data about US imports (crude and products).

  • Great Response! 1
  • Upvote 1

Share this post


Link to post
Share on other sites

(edited)

59 minutes ago, Marcin said:

"net exporter" means you export more than you import. United States is not net energy exporter it is net energy importer.

In your example you miss the data about US imports (crude and products).

Keep it simple

Look at last week's EIA data.

8 million crude and product imports/day

9 million crude and product exports/day

 

Edited by Jabbar

Share this post


Link to post
Share on other sites

(edited)

3 hours ago, J.R. Ewing said:

Actual 2019 US production maxed out at 12.1 million and I doubt it's up to 12.6 million in the last few weeks as you and the EIA claim.

I look at most recent weekly EIA data.  

12.6 last three weeks.

Sounds good to me.

We tend to get bogged down in the minutia.  BIG PICTURE plenty of oil.  

Most shale haters talk about rig count. 

1. Yes lower rig count. Some smaller players out of business.

2.  Many majors and large independents have increased production while reducing rigs by avg of 30%.

3.  Most important with increased Permian pipelines there has been large increase in completing DUCs. Don't need rigs to increase production. 

Estimate sometime second half of 2020 for strong increase in rig count. 

REMEMBER CONOCO INCREASED TOTAL RECOVERABLE SHALE OIL FROM EAGLE FORD FROM 9% - 10% to 20%.

THIS EXCEPTIONAL RESULT WILL BECOME THE NORM DOUBLING RECOVERABLE SHALE RESERVES AND SUBSTATIALLY REDUCING COSTS.

Edited by Jabbar
  • Great Response! 1

Share this post


Link to post
Share on other sites

2 minutes ago, Jabbar said:

I look at most recent weekly EIA data.  

12.6 last three weeks.

Sounds good to me.

We tend to get bogged down in the minutia.  BIG PICTURE plenty of oil.  

Most shale haters talk about rig count. 

1. Yes lower rig count. Some smaller players out of business.

2.  Many majors and large independents have increased production while reducing rigs by avg of 30%.

3.  Most important with increased Permian pipelines there has been large increase in completing DUCs. Don't need rigs. 

You seem to have difficulty understanding that the weekly EIA data is not data.  It is based on surveys, opinions, guesses, etc. and made up by bureaucrats.

A 800,000 barrel difference between the current EIA estimates and the last actual data reported is not minutia.

Thanks in advance for trying to be more accurate with your future posts.

  • Great Response! 1
  • Upvote 1

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
You are posting as a guest. If you have an account, please sign in.
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.